Morgan Stanley Issues Pessimistic Forecast for Houlihan Lokey (NYSE:HLI) Stock Price

Key Points

• Morgan Stanley cut its price objective on Houlihan Lokey from $205 to $193 but kept an "overweight" rating, a target that still implies roughly a 28.2% upside from the current share price.
• Analyst views are mixed — several firms have trimmed targets (Goldman, UBS, Keefe) while BMO raised theirs; MarketBeat's consensus is a "Moderate Buy" with an average target of $197.71 (five Buys, four Holds).
• Shares traded around $150.52 with a $10.51B market cap and a 23.1 P/E; the company beat quarterly EPS estimates and revenue rose 13%, but there has been insider selling and institutional ownership is high (~78%).

Houlihan Lokey (NYSE:HLI - Get Free Report) had its price objective lowered by research analysts at Morgan Stanley from $205.00 to $193.00 in a research note issued to investors on Thursday,Benzinga reports. The firm presently has an "overweight" rating on the financial services provider's stock. Morgan Stanley's target price indicates a potential upside of 28.22% from the stock's current price.

Several other equities analysts also recently issued reports on the company. Keefe, Bruyette & Woods cut their target price on Houlihan Lokey from $218.00 to $214.00 and set an "outperform" rating on the stock in a research report on Thursday, January 29th. BMO Capital Markets upped their target price on Houlihan Lokey from $209.00 to $211.00 and gave the company an "outperform" rating in a research report on Thursday, January 29th. Weiss Ratings downgraded Houlihan Lokey from a "buy (b-)" rating to a "hold (c+)" rating in a research report on Monday, March 9th. The Goldman Sachs Group cut their price target on Houlihan Lokey from $210.00 to $184.00 and set a "buy" rating on the stock in a research report on Wednesday, April 1st. Finally, UBS Group cut their price target on Houlihan Lokey from $196.00 to $163.00 and set a "neutral" rating on the stock in a research report on Thursday, March 12th. Five analysts have rated the stock with a Buy rating and four have issued a Hold rating to the stock. Based on data from MarketBeat, Houlihan Lokey has an average rating of "Moderate Buy" and an average target price of $197.71.

Houlihan Lokey Stock Performance

Shares of NYSE HLI traded up $2.68 during mid-day trading on Thursday, hitting $150.52. The stock had a trading volume of 138,242 shares, compared to its average volume of 593,250. The company has a 50 day moving average of $154.69 and a two-hundred day moving average of $174.58. Houlihan Lokey has a twelve month low of $134.41 and a twelve month high of $211.78. The firm has a market cap of $10.51 billion, a PE ratio of 23.12 and a beta of 1.00.

Houlihan Lokey (NYSE:HLI - Get Free Report) last released its earnings results on Thursday, January 29th. The financial services provider reported $1.94 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.85 by $0.09. Houlihan Lokey had a return on equity of 24.46% and a net margin of 16.91%.During the same period in the prior year, the business posted $1.64 EPS. The business's revenue was up 13.0% compared to the same quarter last year. Equities research analysts predict that Houlihan Lokey will post 5.98 EPS for the current fiscal year.

Insider Transactions at Houlihan Lokey

In other news, Director Robert A. Schriesheim sold 5,000 shares of the firm's stock in a transaction dated Friday, February 6th. The stock was sold at an average price of $170.86, for a total transaction of $854,300.00. Following the sale, the director directly owned 27,982 shares in the company, valued at $4,781,004.52. This trade represents a 15.16% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, General Counsel Christopher M. Crain sold 500 shares of the firm's stock in a transaction dated Wednesday, April 1st. The shares were sold at an average price of $143.40, for a total value of $71,700.00. Following the sale, the general counsel owned 500 shares in the company, valued at $71,700. This trade represents a 50.00% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 22.83% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently bought and sold shares of HLI. Royal Bank of Canada lifted its stake in Houlihan Lokey by 362.1% in the 4th quarter. Royal Bank of Canada now owns 1,703,369 shares of the financial services provider's stock valued at $296,706,000 after buying an additional 1,334,769 shares in the last quarter. Bank of Montreal Can lifted its stake in Houlihan Lokey by 2,723.2% in the 4th quarter. Bank of Montreal Can now owns 1,199,459 shares of the financial services provider's stock valued at $208,934,000 after buying an additional 1,156,973 shares in the last quarter. Mayflower Financial Advisors LLC purchased a new position in Houlihan Lokey in the 3rd quarter valued at about $230,335,000. Norges Bank purchased a new position in Houlihan Lokey in the 4th quarter valued at about $115,478,000. Finally, Thrivent Financial for Lutherans lifted its stake in Houlihan Lokey by 75.6% in the 3rd quarter. Thrivent Financial for Lutherans now owns 713,494 shares of the financial services provider's stock valued at $146,495,000 after buying an additional 307,214 shares in the last quarter. 78.07% of the stock is owned by hedge funds and other institutional investors.

About Houlihan Lokey

Houlihan Lokey, Inc is a global investment bank and financial services firm founded in 1972 and headquartered in Los Angeles, California. The company specializes in advisory services across a broad range of transaction types and financial matters. Since its founding, Houlihan Lokey has grown to serve corporations, financial sponsors, and government entities worldwide, providing expertise in complex and high-stakes engagements.

The firm's core service offerings include mergers and acquisitions advisory, capital markets advisory, financial restructuring and distressed M&A, and valuation and fairness opinions.

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